Income Statement
(Profit & Loss Account).
Formula
Operating Profit = Revenue − Cost of Sales − Expenses
Real World
Tesco's 2023 income statement showed revenue of £65bn but after deducting costs of goods sold and operating expenses, operating profit was around £2.6bn — illustrating how slim retail margins can be.
Exam Focus
When asked to 'analyse', link each income statement line to a business decision, not just define the terms.
How well did you know this?